“You are never too old to play, your only too old to wear low rise jeans!
(Ellen DeGeneres).
My website, jlfromwithin.com focuses on women who feel age is limitless. They embrace the daily path that guided them to where they are and the mystery of what’s possible. They care about themselves, physically, mentally, and financially.
I come from a background in finance and over the years I have discovered that financially savvy women are usually women that have made mistakes and survived! Finance is emotional, it has its ups and downs and we bear it oftentimes in secret. We almost never share the bottom line with anyone, not even our own family members. There is a sublime understanding that money talk can be vulgar, ostentatious or even embarrassing. But one thing for sure - it is important. The opposite of the money pendulum is debt and that is the single item that can erase freedom. – Although we know money isn’t everything in life, it does rank up there with oxygen.
You depend on your doctor, accountant and lawyer in your professional realm but the person who should be the at the center of that realm should be your "advisor”. Why? Because each of your confidants has an important job in your life’s plan. The accountant is the cloth, the lawyer, the buttons but the advisor is the thread which brings the garment to fruition and you are... the Elegance.
Choosing an advisor isn’t easy. As Agatha Christie once said: “When money is concerned it is advisable to trust nobody.” So, the primary concern is not just finding someone who is competent but finding someone you feel confident and comfortable with – (The 3 “C’s”).
Widows oftentimes leave the advisor their husbands have employed for years, in search of someone they can better relate to. More often, than not, women seek other women to handle their financial affairs because of the comfort objective. While that objective is more a gut feeling the other qualities of competency and confidence are just as paramount. Sometimes, women have their own advisors separate from their husbands, but speaking honestly, if this is the scenario the advisors should have communication for tax minimization purposes. Lastly, women sometimes look to their friends for referred candidates - not the preferred method as everyone's needs are different. Best to be independent!
From my experience, I have come up with certain criteria that women should take into consideration when interviewing anyone for the position of Advisor. I broke it down into three steps. The soft, medium and hard analysis. Be armed and be tough – this is not something you want to do often. So any doubt or negative gut feeling is not acceptable. Again Why? Because moving your accounts to different organizations is costly $$$ and a huge pain in the butt!
Hard Analysis
is actually the easiest to check off as we are looking at a list of services offered. It basically boils down to a matter of looking at your financial circumstances and circling the services that your situation is predominately centered around. For example, you might not be a business owner, and business transition planning might not be on your radar.
However, you could be the owner or a prominent or key employee in a company and an IPP (Individual Pension Plan) or RCA (Retirement Compensation Arrangement) might be something you can learn about and talk to your employer about implementing.
Below are columns that outline services, that at a minimum you should be looking at to ensure your future advisor has these options and can provide a "Holistic" financial services program, so you are not missing out on important future opportunities. At the end of this outline - I will provide a briefing of Advisor categories and how compensation works. This is an important outline as fees and qualifications / platforms that Advisor's hold may be the deciding factor in your choice.
In a prior life, I came from a banking background, I knew what my family and I were looking for in a financial advisor and was lucky enough to find it. Asking the right questions - wading through the ocean of options on the market and determine what was best suited for our circumstances in both Investment Management Services, Advisor qualifications - and of course "what feels like the right fit".
Investment Services
Cash Flow Management
Investment Planning
Portfolio Management
Tax Planning
Retirement Planning
Estate Planning
Insurance
Philanthropy
Next Generation - Learning Programs and transitioning wealth to the next generation. Wealth does not come with an instruction book.
Divorce
Aging Parents
Family Meetings - understanding what to do, if something unexpected happens - it's amazing that most people don't know where their loved ones keep their Wills and Powers of Attorney - not to mention who is Executor and / or Guardians.
Services – If you own a Business
Cash Flow Management
Insurance
Health Services
Mediation
Benefit Programs
IPP / RCA
Portfolio Management
Philanthropy
Business Transition
Medium Analysis
This is a list of questions, you should bring to the meeting to take notes for comparison as well as references to comfort and confidence. Remember to jot down your overall impressions as soon as possible after the meeting.
1. FIDUCIARY - It’s my number one because it directly relates to an advisors compensation.
Let’s delve into the definition to better understand it’s importance. Basically, the Advisor has to be on a certain "Platform" in his company to be able to claim a 100% fiduciary standard. Not a "suitability standard" or claiming they are "like" a Fiduciary. Be careful. They have to answer this question with a yes or no, only - no explanation necessary. The term Fiduciary refers to "choosing the best investment options for the client without bias as to compensation". In fact this could be asked prior to setting up a meeting. Yes, it that important in financial era.
2. EDUCATION - CREDENTIALS - Chartered Financial Analyst (CFA)
People could argue but - a must as far as I am concerned!
A Chartered Financial Analyst (CFA) is a globally-recognized professional designation given by the CFA Institute, (formerly the AIMR (Association for Investment Management and Research), that measures and certifies the competence and integrity of financial analysts. Candidates are required to pass three levels of exams covering areas, such as accounting, economics, ethics, money management, and security analysis.
The reason I put so much emphasis on this certificate is the extended education credits on an annual basis that is required to be undertaken to meet standards of the Canadian Securities Commission (CSC) or it's equivalency in the United States. But, also it meets the education standards according to the services I discussed above. There are brokers and mutual funds salespeople, financial advisors who do not have this designation and who operate on both a "commission" and fee basis.
3. FEES
The almighty fees - Ask one question: Are you paid a commission or a fee for your services? Make sure you are on a fee basis. Why? - Advisors who are paid by fees earn more as you earn more. It's just that simple. Commission compensation - they get paid even if your investments go down. Advisors in banking often get a salary and commission and you sometimes feel like one of the herd. Incentive is a wonderful thing!
4. HOW LONG HAVE THEY BEEN IN THE BUSINESS - AND CLIENT REFERENCES?
Ask? I like to have a few years under the belt, makes me feel comfortable knowing they have experience in their corner. And continuity – 2nd chair in command is always a good thing – things can happen!
5. PROPRIETARY PRODUCT? -
No, No and No. Advisors receive higher commissions selling their company’s own products. It results in conflicts of interest which is brings up questionability as to compensation. Investments should be at arms length.
6. "COOKIE CUTTER" PORTFOLIOS
Ensure you are asked to fill out a Risk Tolerance and Capacity Questionnaire to determine your individual portfolio content. Very important to be 100% sure you do not get put into something that is too risky unless you ask for it. The Advisor will ask you to sign off on any risky investments to ensure you understand the depth of your circumstances. I know clients like to dabble with small amounts to have some market fun, I fully understand but I think it important to have this little dab of money outside of central portfolio. Wealth Managers should ask you to provide the name and contact information of your Accountant and your Lawyer as all three should be working together. Perfect Trifecta. Advisors should keep close contact with your Accountant prior to year-end to capture / harvest any losses that can reduce your taxes for the year - as an example. You will also be asked for copies of your Wills and Powers of Attorney to be kept on file and for evaluation - I will say most Lawyers object to this as they might feel threatened - tell them to park it, ego has no room in your financial planning. I haven’t met a will yet that is bulletproof.
Soft Analysis
Is my Advisor an easy person to talk to?
Does he/she understand I am curious and need to ask many questions?
Can I call him/her at any time during business hours and he will get back to me the same day?
Is the staff approachable, courteous and helpful?
Is the office well maintained and privacy paramount?
Thank you – hope this helps!
My website: www.jlfromwithin.com is filled with individuality, elegance and style under the umbrella of sustainability. I have researched many caveats that lean towards women who are interested in taking care of their life, the planet and philanthropic desires. Finances should be something we embrace and deposit into our comfort zone. Once you have the "Trifecta" on your side, you can relax. I love calmness in my life and I picked items that I believe are important enough to share. The one thing I learned is that fashion fades but elegance is eternal. It’s also fun, it flows from your inner confidence and leaves plenty of room for frivolity and self- expression. Elegance has good manners, grace and hospitality. It's the perfect guest. I would love to invite you to visit my website and please give your opinions/suggestions and anything in particular you want to hear about. dm
“I would rather carry around a plastic bag with $10,000 in cash than a Hermes, Louie Vuitton, Prada bag with only a $100 inside. --- C Joybell C.
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